Why buy when you can rent? A brief investigation of differences in acquisition mode based on duration

Abstract

This article highlights an intriguing finding that the duration of use significantly affects consumers' choice of acquisition mode. When the duration is short, renting is preferred, while buying is preferred for longer durations, even when the economic consequences of both choices are exactly the same.

Notes

¹ A pilot test indicated that the durations of 3 months and 1 year were, respectively, perceived as being short and long in the context of renting furniture.

² In accordance with Baron and Kenny (1986), M is a complete mediator of the effect of X on Y if three conditions are met: (1) X significantly affects Y in the model Y = X, (2) X is a significant predictor of M in the model M = X, and (3) in the full model Y = M × M∗X, M is a significant predictor of Y and renders X nonsignificant. In our study, Y is the choice rating, X is the duration and M refers to the belief dummy variables.